Sponsored research procurements allow institutions to obtain the supplies necessary to successfully complete the objective of a newly funded sponsored research project. After submitting the proposal, receiving the award, and concluding negotiations, the research team can finally begin to spend the grant funds. While it is tempting to immediately fill your virtual shopping cart with items such as beakers, 3D printers, or equipment, it is important to understand the process in which you are about to engage. Though every institution varies on how sponsored research procurements are handled, there is an overall understanding that can guide you through the process. This blog reviews tracking purchases, the procurement lifecycle, and the methods by which purchases can be made.
A critical component in tracking and managing sponsored research procurements is a grant accounting software system. The system should be able to handle the entry of initial encumbrances, tracking of outstanding encumbrances, and entry of expenses and associated liquidations of outstanding encumbrances. This data can also incorporate custom grouping codes to allow for tracking and reporting of different types of procurements together. The IT Works team can collaborate with an institution to accomplish these items through a variety of methods. Depending on the institutions’ needs, involved parties may use an import from the GL system to populate this data or manually enter data associated with procurements or a combination of the two methods depending on the ability to access procurement information from purchasing and associated expenditure data from the general ledger.
Life Cycle of Sponsored Research Procurements
Once the award for a grant funded project is received, a corresponding account must be set up within the institution. The PI should identify all the items that will need to be purchased, including supplies, equipment, and contracted services. The PI and research team will work with a unit administrator, often a unit research administrator, or a central purchasing agent, to initiate the procurements. To be able to initiate the procurements, the proposed purchase must receive institutional approval. This approval process varies from institution to institution; however, the process must include an individual or office responsible for ensuring accountability and allowability of the purchase.
The actual procurement method used will vary, depending on the item being obtained. Once the institution receives the product or service someone acknowledges that it arrived in an acceptable form or fulfilled the required service. This accountability for the end of the procurement process ensures the purchases met all outlined requirements and accurately reflect what the Principal Investigator or their research team requested.
Purchases and their receipts will need to be reviewed on a regular schedule. If a research project is producing a high volume of procurements the unit or central office may choose to review these procurements on a more frequent basis to keep up with the flow of funds. Review is critical as many sponsors require any movement of procurements within a ninety day period. The unit contact or central office may not reconcile every purchase, but instead conduct spot checks. This is popular with transactions that are more common in nature. Expenses that are typically more controlled and regulated, such as equipment and travel are generally more diligently monitored.
Some of the most popular procurement methods include purchasing cards, purchase orders, travel vouchers, central and chemical stores, and service contracts. The purchase card, commonly referred to as a “p-card”, operates in the same manner that a credit or debit card does. These cards may be assigned to specific personnel and may be more controlled depending on the institution and type of purchase.
There are specific costs that are generally not or cannot be placed on a p-card or purchase order. A travel voucher may be used when an institution requires that a specific and separate process be used for travel expenses. An institution may at times make bulk purchases of general purpose items, such as beakers, chem wipes, and swabs, and make them available throughout the institution through a central or chemical store. These stores not only serve as a backup if items are on back order from a supplier, but also tend to be the more economic choice, as the per unit cost has been reduced.
Regardless of the type or method of procurement, it is imperative to invest in a grant software system that will manage your sponsored research procurements effectively. Contact the IT Works team today, to see how our software can better serve your research office.